Market Strategy

[music] >> Hello, I'm Greg Bonnell. Welcome to MoneyTalk Live, brought to you by TD Direct Investing.

coming up on today show, TD Asset Management set Ben Gossack is going to take us to the underlying trends he's watching through all this recent market volatility. And we are going to get to take summer rates are headed after the Fed hiked by another 25 basis points this week.

TD Asset Management Hafiz Noordin and TD Economics and James Marple will give us their views.

And in today's WebBroker education segment, Bryan Rogers is going to walk us through stop orders and how you can use them on the platform.

Before you get all that, let's get you an update on the markets.

As he put our heads down to bed last night, there was some developments in the European banks sending some notes of caution through. Deutsche Bank and the cost of insuring at the debt against default spiked and got some concerns about European banks again.

Right now got the TSX with a modest 23 point pullback, little more than 1/10 of a percent for the price of crude is under pressure again today and it is playing on some of the big energy names on the TSX. Got Crescent Point Energy now it eight bucks and $0.98.

It's off the lows of the session and just down a pretty modest third of a percent. Barrick Gold was making some modest gains earlier with gold above 2000 bucks an ounce. At 2563 at Baruch right now, it's holding onto those gains up a little bit more than 2%. South of the border, let's check out the S&P 500.

It's down a very modest three points right now. It's we could the open as people are trying to assess what all the central bank action… What does it mean going forward for not only the economy in the fight against inflation but got some of these banking concerns that we had. But this is a pretty modest pullback right now, just 1/10 of a percent.

The NASDAQ, the tech heavy index.

Let's check in. A little more pain here, 91 points to the downside, a little risk coming off the table today, three quarters of a percent.

Let's show you Deutsche Bank and see what effect it had on their shares. These are coming off the lows of the session as well.

At nine bucks and $0.38, your down just about 2.8% right now. And that's your market update.

A year of aggressive rate hikes had some investors worried about unaccepted stress points in the economy.

And while markets have been volatile in recent days amid the turmoil in global banks, Ben Gossack, portfolio manager at TD Asset Management says that some underlying market trends are still intact.

He joined us earlier to discuss.

>> We've had four banks fail.

There is another on life support.

Their fears about where to park your money.

And yet, from a volatility perspective, from a dollar flight perspective, it's been quite pedestrian.

And I think it goes back to we've kind of been on this doomsday clock or this 11th hour for almost a year, given how much we've hiked rates.

We have a war that started in February of last year. We thought there would be an energy crisis and Europe would be in recession.

Even in September, we were worried about the impact of UK pension plans related to the UK budget.

So if anything was going to break, it felt like it was going to be last year.

And then that fear of something breaking, well, we may not like what broke, but that fear of something breaking has happened now.

And so I think the market is kind of like, OK, now I know what I was worried about.

I can deal with this and try to see what happens going forward.

>> Let's talk about what's happening going forward, what you've even noticed beneath the surface in terms of what has been happening in the markets. I'm not sure what you want to start with, maybe just the volatility gauge.

>> Yeah, so we'll start with volatility and kind of what this looks like in keeping to historical issues.

And then what we see going forward is kind of what we've been seeing for quite some time, which I find very fascinating.

So in terms of our first chart, this is the VIX. That's the standard sort of volatility measure for the S&P 500.

We saw a jump to about 30. And that's quickly dissipated.

Again, in times of crisis, we've seen this go as high as 80.

Somewhere around 40, you'd be like, wow, things are really bad.

But again, I think it goes back to the fact that the reason why the volatility seems somewhat contained and we're not seeing dollar flight is that we've been on this watch waiting for something to break.

And again, I don't know if anyone had forecasted this specific failure, but we have seen some type of failure. And so, yeah, what we knew was going to happen, happened.

>> OK, let's talk about other parts of the market right now. Homebuilding is interesting.

Considering how much the cost of borrowing has gone up in the past year, you would think there'd be an impact.

And there's been an impact in this country. US homebuilders, what story is that telling?

>> So this is the part that I find fascinating is that the trends that we had identified at the end of last year going into this year were unwavering in all of this volatility last week and this week of the banks failing. And we're actually on the anniversary of the first Fed rate hike. And it seems very counterintuitive and almost like a counter trend to the prevailing wisdom, but the time to go long US homebuilders-- and these are the most sensitive to interest rates-- was at the time of the first Fed hike.

>> Does feel very counterintuitive, but here's the chart right here.

>> So what we're looking at is I call these a ratio charts, but think of them as a tug of war chart. So if it's going up and to the right, it means that the homebuilders are winning the battle against the S&P 500. So if you're going long homebuilders, short S&P 500, you'd probably be considered an all-star hedge fund manager on this particular trade. But what it tells us and what is informative about this specific chart is that the market in all of its wisdom knew housing was going to be a problem because we did see 7% mortgage rates, we have seen existing home sales slide, we've seen new homebuilding applications come down.

And it has absorbed all of that bad news, even though the bad headlines didn't come until almost 8 months, 9 months, 10 months later. And we found that very informative, especially with other areas that are, again, early cycle start to bottom and lift up.

>> When I think about the next picture you have to show us about the semiconductors, this one should be sensitive, as well, to the economic cycle. We've had a lot of concerns in recent months too about, is there going to be a recession? What's it going to look like?

How deep is it going to be? How wide is it going to be?

What have the semiconductors been telling us?

>> Right. And semiconductors are also early cycle. We did see an extended cycle through COVID with supply chains and shortages. But then that cycle broke and we had oversupply. And so while we still haven't seen a bottom in the earnings for semiconductor companies, from our charts-- again, our ratio relative to the S&P 500-- they bottomed in October of last year and they continue to improve.

And again, looking at our chart, they got even stronger last week. Again, four banks fail, everyone says, oh, here comes the recession. But is this the recession on top of the recession that we've been talking about since last year? Again, similar to our housing example, the semiconductor stocks have already looked through some of this noise and slowdown and recession and continue to get stronger relative to the market.

>> Let's look at this chart. This will be interesting in terms of times of economic stress and of concern, maybe you don't spend on the big, expensive things. You get down to basics. But luxury goods, what story is this telling? Well, that's quite a story.

>> So we're looking at the LVMH, which is the preeminent luxury, let's say, house, with brands such as Dior, LV, into spirits, everything. But this is the preeminent house. This has gotten stronger. It even started last year-- but luxury has worked relative to the market and also got stronger last year.

But I could also show you Hermes. I could show you Ferrari.

Every luxury stock has improved. Part of it has to do with there is a secular growth trend in luxury and they can grow top line 8% to 10% every year.

The other part is that the people that can afford these types of items have been unaffected by inflation. And even with a bit of concerns around regional banks, again, their wealth, again, will not stop them from buying the next marginal purse or the next other sort of leather good. But it does tell me a lot that, given fears about economic recession, luxury has looked through this and says, yeah, there might be bad news.

I'm not saying, Greg, that there isn't bad news, there aren't concerns, there aren't slowdowns. There might be a rise in unemployment. I'm just saying the wisdom of the market has said, yes, we've taken that into consideration and we still see strengths in these areas that I would consider to be of early cycle sectors.

>> Truth be told, even before the central bank started hiking aggressively about a year ago, my family really wasn't in the market for a Ferrari just yet. Maybe a couple of years down the road. So we take all these things together, what do we make of the underlying movements in the market compared to all the headline whipsaws we've had recently?

>> Yeah, so, look, we still remain vigilant about the market, and employment, and valuations.

And we'll always stay that way. And we always skew towards quality. Prior to the banks failing, we had already started to increase the cyclicality within our portfolios-- again, given the green shoots and the trends that we were seeing.

And so coming out through last week into this week, we haven't changed anything. And the fact that semiconductors got stronger, luxury got stronger, it just gives us further confidence that there is still bad news to come. But the market, again, in its wisdom has sort of factored that in. Now, you never know the magnitude, so maybe we factored in this much and there's this much more.

That's always the risk in terms of portfolios. But a well constructed portfolio following a process, and ours is quality, and cash flow, and compounding, I feel very confident that this green shoots thesis or better than fear thesis that we've been working on continues to have legs.

> That was Ben Gossack, portfolio manager with TD Asset Management.

Now say you updated on some of the top stories in the world of business and take a look at how the markets are trading.

Acceleration and vehicle sales helped increase consumer spending to start they are.

Retail sales rose 1.4% in January, that's a much stronger showing that expect you.

TD Economics has households got some reprieve from financial stress in recent months.

However, TD Economics expects consumer spending to slow significantly this year as higher interest rate work their way through the economy.

shares of Deutsche Bank are in the spotlight today that is the cost of ensuring its debt against default by tire Thursday night. The volatility is being felt across European banks today as investors try to assess the risks and the global financial sector following the rescue of Credit Suisse.

There are some developments in Microsoft's proposed takeover of videogame maker Activision Blizzard.

Written competition regulator says he believes the takeover would not lessen competition in the gaming console industry.

There had been some concerns that Microsoft would withhold the blockbuster game call of duty from its competitors, but the regulator of Britons has the cost to Microsoft doing that would outweigh any gains. Let's check on the market, starting here on Bay Street with the TSX Composite Index.

it is down a modest 30 points, a little bit more than 1/10 of a percent. We have energy weighing on the trade today on the top line number.

South of the border, the S&P 500 has been working its way off the lows of the session.

It's about eight points right now or offensive a percent.

Of course, the US Federal Reserve raised interest rates by another quarter-point this week, a move that comes as policymakers also deal with this way for banking turmoil.

but they also signalled that they may be near the end of their hiking cycle.

James Marple, Senior economist with TD join his earlier with his view.

>> I think they made the right decision ultimately. I think the market had been anticipating 25 basis points and they delivered on that.

There was some speculation they would pause given some of the turmoil we've seen in financial markets. But interesting, before all of the recent events with SBV and whatnot, there was even expectations they'd go as much as 50.

And certainly, the economic data that has come in at the start of this year would have warranted some of that.

I mean, we've seen both job growth come in well above expectations and sort of well above the pace you'd expect given where the unemployment rate is, but also seen inflation that remains stubborn and something that they're trying to get to 2%. More hikes would have been on the table, but offset obviously, by what we've seen in terms of the banking sector >> Yeah, it seems like the collapse of Silicon Valley Bank-- signature of the worry about some of the US regionals. Definitely had them dial back that tough talk. Because the tough talk was only two weeks ago. I mean, that was when Jerome Powell was in Washington saying maybe we needed to go further than expected on rates, putting 50 on the table. And all of that got dialed back. And now the market is trying to figure out if they're done or not.

But as you said, the economic conditions-- we got some jobless numbers this morning. And the labor market is still tight in the States. This seems to be a pretty tough road ahead for the Fed.

>> Yeah, well certainly, that was even reflected in both the statement and in the chairman's press conference afterward where he really stressed the uncertainty that the Fed themselves face, but all economic forecasters face, in the current environment.

I mean, trying to figure out how much this tightening and financial conditions-- how much, probably, now will be a tighter lending standards, especially among some of these smaller banks that have been under pressure, what that will mean to the real economy. And there just isn't a lot to go by on that.

I mean, we can try to obviously look at historical correlations. But in many ways, this is kind of unprecedented, certainly in the speed at which things have happened and just given all the changes that have happened in the financial sector over the next decade.

So it is a little bit of a guessing game.

But I think we can say that if, when financial conditions are tightened and when lending standards are tightened, it tends to result in less loan growth, less demand, and less economic activity, in some sense, that replaces what the Fed was trying to do in terms of raising interest rates.

So I think it makes sense for them to say maybe we're close to the end. We obviously have to watch, very carefully, the economic data as it comes in, but also just some of the very high-frequency data in terms of what we're seeing in terms of deposits and loan growth, especially commercial and industrial lending, commercial real estate lending, where some of these smaller banks are really important to those sectors.

So yeah, I mean, wait and see mode while we try to sort through, do we see calm now? Do things go back to normal? Or is there another shoe to drop?

And unfortunately, I don't think anyone has the answer to that.

>> Yeah, it's be great if we did have the answers in advance. It would make all of this a lot easier. In the wake of the Fed, you get the Bank of England. You get the Swiss National Bank also raising rates. But here at home in Canada, we are on pause.

And we got the Bank of Canada minutes around that thinking. Was there-- now, we're not used to getting minutes from our central bank. I think this is only the second go around. Are we gleaning any information from there, though, in terms of what might they be thinking of going forward?

>> Well sure, I mean, it was funny. They released the minutes at 1:30. And the Fed still was-- >> Yeah, it was like, look at them front-running the Fed, trying to take all the glory.

>> Yeah, I mean, we-- I didn't even realize it came out until-- because we were so focused on the Fed. But yeah, I mean, a little bit more, nothing too surprising. We got some of their thinking with respect to inflation and what had to happen for inflation to come down toward their target, reflecting some of the strength we've seen in-- continued strength in the labor market. But they had a few statements.

I mean, around inflation, I think it was interesting that they have commented that they see signs that expectations for inflation have risen above a level that they think is consistent with their hitting their 2% target. And they need to see some of that come in.

Similarly, on the wage front, that wage growth is higher than is consistent with their 2% inflation target. And of course, seeing what we've seen in the labor market, ongoing, very strong job growth and record low unemployment rate, no signs that that's really going away anytime soon.

So yes, they are on pause. But I think there's probably some risk in both directions with respect to policy there. I think as they've recognized in their statement, and we know, the Canadian economy is more interest-rate-sensitive. And our own forecasts do expect to see some underperformance vis-a-vis the US.

So it does make some sense that they would remain on pause. And certainly now, with this uncertainty we've seen in financial markets and the contagion we will see to Canada, a wait and see approach, I think, makes a lot of sense.

>> They've been telling us all along that to bringing inflation down, they're going to have to see the impacts of all these aggressive rate hikes. And the biggest impact would be pain in the labor market. I briefly mentioned the fact that the latest read on US jobless numbers still showing a very strong market there. How come we're not getting that weakness in the labor market? I think-- I would think some of the central bankers are scratching their head right now that we're still not seeing it.

>> Well, I think it's a good question. I think, always, we've seen that the labor market lags some of the other indicators of real economic activity. And we certainly have seen signs that real activity has slowed. But definitely, I think the pandemic and some of the disruption that we've seen there has made reading the tea leaves even more difficult and has probably changed some of the lead and lags in economic variables. And it is a little bit of a mystery.

I mean, we've seen economic activity slow and job growth not show any signs of slowing, in fact, accelerate. Some of it has been in some strange sectors that are not all that cyclical. We've seen, especially in Canada, hiring in government sectors and other places where you could maybe say that's a one-off and probably not going to be maintained. But I agree, it is a little bit of a mystery. But I think in all the forecasts reflecting the slowdown we've seen, we would expect that margin compression, seeing demand start to come in, that is going to show up in the labor market in terms of a slowdown in hiring and a move up in the unemployment rate.

One thing I think that's important in Canada that is a big difference versus the US is just the rate at which the population is growing. And so-- >> It was, like, over a million people for the first time ever last year?

that was the number I saw.

>> That's right.

Exactly. So that very strong population, and therefore labor force growth, creates a higher bar for the number of jobs you have to create before you see some upward pressure on the unemployment rate. So in Canada, I think it's quite possible that we see the unemployment rate go up as the economy is slowing, even if you don't see outright job losses or don't see significant job losses just because you're moving against an increasing target for the number of jobs you have to create just to stay still on the unemployment rate.

>> That was James Marple, Senior economist with TD.

Now, let's get to today's educational segment.

And volatile markets, you may consider using stop orders as one tool to limit your risk.

Joining us now to walk us through a, Bryan Rogers, senior client education instructor with TD Direct Investing. Great to see you again.

Walk us through how stop orders work.

>> All right, Greg.

Most people that have traded stocks in the past are familiar with using a market order or limit order whether to buy or sell. So market where it's going to go through right away and not available market, if you are selling your stock. A limit order you might enter it a little bit above the current market to get a better price. But as you get more into investing, you may come across a stop order and that's what we want to be slain today. It's kind of like a just in case order where if you are looking to sell something, maybe you want to protect your profit or avoid a further loss, if you're uncertain about the market, which I know right now we been talking about a lot of uncertainty and news coming out that could change the markets up to down from a day-to-day basis, I want to take everyone through what a stop order is and how you can use it.

If we jump over into WebBroker, you can see here that I have an example, just a random example.

we are looking at Apple stock.

you going to WebBroker, put in the symbol, go to the charge tab. Dilute to see a basic chart where you can see if you had purchased Apple say back in March when it was closer to around 140, now you're thinking, okay, I want to protect the profit on this, you can watch it every day.

That's one way you can look at it.

And some people do. And say, I'm just going to sell it at a market order when it gets to a certain point.

Obviously, it's come up quite a bit.

It's at 158 and some change at the moment. If you want to protect disorder and enter a market order right now that will go through right away at today's price, it would go through. If you enter a limit order below the current market, it will go through immediately. It will turn that sell order into a immediate order because it will satisfy the limit and be at a better price if you hundred something a little bit lower.

therein lies the stop order we can say, as I said, it's like a just in case. You can say well, if it comes back now to say 155 or if we want to go down as low as 150, you don't want to go too close to the current price, you're just putting in a trade that's being held within the brokerage to say, if it does drop down to 155, I want to trigger a market order, for example. You also have a stop limit order. You can set a limit. And as soon as that price drops down to the price that you had in mind, it's going to automatically happen words going to get you out of that stock at a price that might still be at least a decent profit" to protect you from a further loss.

>> Right now, we understand stop orders, what they are used for. How do you actually enter one on WebBroker?

>> Yeah, that's something that is a little bit tricky at first but once you have the language down, I will show quick way were you can find more information on this, we do a lot of classes on these ones as well.

There is another one called a trailing stop order but we will leave that for today. It's a bit more complex.

But for a basic stop order, if you jump into WebBroker and go to do a trade, I'm on the Apple example now.

So I click on the cell tab, it can open the order ticket and you're gonna be able to see what looks familiar, buy or sell, these price types.

You may have noticed if you looked at buying a stock recently on a market or limit basis, you see market, limit and right now we are going to see just below that a stock market and stop limit.

I will show an example of a stock market.

I can actually probably show both.

You're normally always going to do this as a sell. You are looking to sell a stock hopefully at a little bit of a lower price. Not wanting to go through it right away, it's just in case if it drops, you want to hold onto the stock but if it drops down to 150 in a bun at 140, now at least I know I have a $10 profit and I can get out of it and be okay with that. Or if it doesn't drop down, then I'm gonna still continue to hold the stock and it can go up even further to 159, 60, etc. So it's not going to go through when you enter this trade.

So put in a trigger price and you always enter it below the market so say put 150.

Then you normally want to do it for a longer period of time than just today. Seagen specified date if you click on this calendar right here.

So I go to the end of next month, for example. Or you can also leave it on this good till section right here.

You can select instead of specifying a specific date you can go to to good till cancelled. That will… For Canadian stocks 90 days, for a US stock it can stay open from 280 days. Lastly really quickly, if you were to do a limit, you want to set a limit order, you can do what's called a trigger price combined with is which would just trigger or set a limit order where you can now set a limit price, let's say you want to be 149. So just to be sure it will be at a certain price want sensitive to market.

That's what it is in a bit of a nutshell but there are other courses within our Learning Center and WebBroker.

Check out those and we go through the whole gamut from the basicstock orders up to those trailing stops as well.

>> Thanks.

Bryan Rogers, Senior client education instructor at TD Direct Investing.

Stay tuned. On Tuesday of next week, Bryan will be the guest on our show, the entire show, take your questions about how to better utilize the WebBroker platform.

And make sure to check out the learning centre in WebBroker for more educational videos, live, interactive master classes and upcoming webinars.

Fed chair Jerome Powell has had to weigh heightened inflation with concerns about the health of the global banking sector.

Earlier I spoke with Hafiz Noordin, portfolio manager at TD Asset Management, about where rates could be headed off to this weeks quarter-point hike.

>> That was the clear debate going into this. With all of the strain in the banking sector that we saw, could the Fed truly separate out its mandate around inflation-- which is its primary mandate, but balancing against these clear risks in the banking sector? The market's take going in was that, with all of the measures by the Fed, the FDIC, and the Treasury, in conjunction together, putting in new facilities to provide liquidity to the banking sector, the Fed could go ahead and proceed with a rate hike today of 25 basis points.

It was about 80% priced in, and that was what was delivered today-- was that rate hike acknowledging that inflation is still high. Core inflation's still in that kind of 5 to 5 and 1/2 range. But what we did see from the statement today from the Fed was an acknowledgment that, yes, the US banking sector is strong, but there's clearly going to be a net new tightening in credit conditions by banks to ensure that they're shoring up their balance sheets, and that will affect the real economy, present more downside risk to growth, and provide more of a strength-- this disinflationary trend that should go on for the next year or two.

>> And that really was the shift that we've just seen in the past couple of weeks. Because two weeks ago, I think almost to the day, we were getting very tough talk from Jerome Powell about the need for ongoing increases. Definitely, that was part of the former statement.

We'll see ongoing increases. Last time he spoke, said maybe even that terminal rate, that endpoint that is higher than we thought it was going to be-- that has gone by the wayside now. Today's statement replaces ongoing increases with maybe some additional policy for now. How do we read all that in terms of the path forward?

>> Yes, so the terminal rate was the one that really got repriced. Earlier this month, after the string of really strong data in the US around the labor market inflation, consumption, the terminal rate got repriced from about 5% to almost 6%. And that really reflected this idea that the Fed would potentially even have to do 50 basis points at this meeting.

Obviously, a lot has happened since early March. And what we've seen now instead is the terminal rate has gotten repriced back to 5%, which means that this hike is pretty much the last one that the market is expecting. And even when you look at the dot plot by the Fed today, it affirmed this idea that the 5% area is where we're basically going to be for the foreseeable future.

Now, the main tension between the market and the Fed is when rate cuts start. With all of the crisis that's started in the banking sector of the last couple of weeks, the market basically pulled forward rate cuts to start as soon as this June or July. The Fed, with its statement today and its statement of economic projections today, pushed back on that, expects a kind of flat policy rate for the rest of the year. But that's what is now yet to resolve.

>> I want to pick up when you said earlier about the fact that what we have seen in the banking sector means that a certain amount of the tightening-- and this was fully acknowledged in the statement and in the press conference from Chair Powell-- that although they said the US banking system is sound and resilient, you are going to see tighter credit conditions. And this will feed through the economy-- almost that idea that this turmoil we've seen in the banks will start to do some of the work for them, that they perhaps would have had to have done with rate hikes, and maybe then they can ease off a bit.

>> Absolutely. That was a key point in the statement, and that Chair Powell did affirm in the press conference, which is that transmission mechanism.

Through the banking channel of the higher policy rates that we've seen over the past year, 400-plus basis points in the policy rate, we're seeing those lagged effects now take hold in the economy. And as soon as you start to see something to break, that does cause credit conditions to tighten.

That means that the real economy is going to be impacted and growth can come down. And I think Chair Powell even went further on to say in the press conference that they even considered a pause because of what happened. So we went from considering 50 basis points to them considering even a pause in just a matter of a few weeks.

And the market really latched on to that, clearly, today, where stocks and bonds have really been rallying against that news, knowing now that the Fed is very attentive to this idea that financial stability has to be maintained to provide an orderly reduction in inflation, not a shock that can really kill the economy.

>> Today's statement and decision taken with the turmoil of the past couple of weeks, and the US regional banks-- what does it mean for the US buck? The US buck had such a run, such a dominance. Where does it go from here?

>> Well, the move today is definitely the US dollar down. The reason is that the big repricing in the bond market is-- when you look at the two-year part of the curve, which really reflects, kind of, changes in the policy rate or expectations of the policy rate, over the next couple of years, is down about 20 basis points or so. And so when you have lower short-end yields in the US, relative to the rest of the world, that usually means the US dollar goes down. And that's what we are seeing. The euro is up today.

And so I think for the most part, this theme now of the Fed pausing and now having to be more data dependent with a bias more to rate cuts coming down the line, that would really mean that the US dollar really doesn't have much of a catalyst to go higher, unless we start to see upside surprises in inflation or labor data which causes a reassessment of this terminal rate above 5%.

>> That was Hafiz Noordin, portfolio manager with TD Asset Management.

Let's check in on the market right now. We will start here at home with Bay Street and the TSX Composite Index. We a West Texas intermediate crude pulling back again today.

It's weighing on some of the energy names.

It were down amount of 56 points below even, little five 1/3 of a percent.

Let's check in on some of the energy names. And God Cenovus under some pressure at 2121, down 1.7%. We've seen gold… At six bucks you've got Kinross up 2 1/2%.

South of the border, the S&P 500 is trying to get into the green. He got there I think briefly for a little while about 15 minutes ago.

It has swung back below. We are down about nine points right now orifice of a percent, try to work its way through the banking concerns that we've been having for the past two weeks.

The tech heavy NASDAQ, let's check in and see how it's variance the broader market.

They are down about 60 points or half a percent.

Activision, and use that British regulators were taking a look at some of those concerns that if the Microsoft acquisition went through they would withhold call of duty from competitors. Regulators were saying that in the face of it it doesn't make much sense.

Activision is getting a bid off of that, up about 5%.

It is a mean the deal has been given the green light, it's just that concerns are dialling back a little bit.

Let's check in on Deutsche Bank. Some of the renewed concern we are having for today's trading session about the banks is focused on the European banks in the sense that the cost of insuring against default on Deutsche Bank's dad, we saw that costs spiked yesterday evening into the night and that means downward pressure on Deutsche Bank.

It's still in negative territory but off the lows of the early points of that news. At nine bucks and 17 says per-share New York, we are talking about a 5% pullback for Deutsche Bank shares.

Make sure to stay tuned. On Monday, David Mau, portfolio manager with TD Asset Management will be our guest taking your questions about industrial stocks, the rails in the plains.

Get your questions in advance for David if you can.

Email moneytalklive@td.com.

As all the time we have for the show today. Thanks for watching and we will see you next week.

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